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Albertsons Companies (ACI)
NYSE:ACI
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Albertsons Companies (ACI) AI Stock Analysis

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ACI

Albertsons Companies

(NYSE:ACI)

Rating:61Neutral
Price Target:
$21.50
▲(12.80% Upside)
Albertsons Companies' overall stock score is influenced by steady financial performance and attractive valuation metrics despite facing profitability challenges. Technical analysis points to bearish momentum, while earnings call insights provide a mixed outlook with strong digital growth but profitability hurdles. The company’s focus on strategic investments and shareholder returns adds a positive note to the overall assessment.
Positive Factors
Investments and Growth Initiatives
ACI's investments and productivity initiatives are expected to begin driving higher growth and cost savings.
Market Position and Valuation
ACI may see valuation expansion as investors seek inexpensive, defensive stocks, with an attractive risk/reward given low earnings expectations.
Negative Factors
Margin Pressure
Margin pressure is expected to continue due to investments in pharmacy, digital, wages, and customer experience.
Pharmacy and E-commerce Profitability
Pharmacy sales have significantly lower gross margins than grocery, and e-commerce is not yet profitable.

Albertsons Companies (ACI) vs. SPDR S&P 500 ETF (SPY)

Albertsons Companies Business Overview & Revenue Model

Company DescriptionAlbertsons Companies, Inc., through its subsidiaries, engages in the operation of food and drug stores in the United States. The company's food and drug retail stores offer grocery products, general merchandise, health and beauty care products, pharmacy, fuel, and other items and services. It also manufactures and processes food products for sale in stores. As of February 26, 2022, it operated 2,276 stores under various banners, including Albertsons, Safeway, Vons, Pavilions, Randalls, Tom Thumb, Carrs, Jewel-Osco, Acme, Shaw's, Star Market, United Supermarkets, Market Street, Haggen, Kings Food Markets, and Balducci's Food Lovers Market; and 1,722 pharmacies, 1,317 in-store branded coffee shops, 402 adjacent fuel centers, 22 distribution centers, and 20 manufacturing facilities, as well as various digital platforms. The company was founded in 1860 and is headquartered in Boise, Idaho.
How the Company Makes MoneyAlbertsons Companies generates revenue primarily through the sale of grocery and pharmacy products in its stores. The company's revenue model is driven by several key streams: first, the retail sale of food and non-food items, which constitutes the majority of its revenue; second, pharmacy sales, including prescription medications and health-related products; and third, fuel sales from its gas stations. Additionally, Albertsons benefits from loyalty programs and private label products, which enhance customer retention and margins. Strategic partnerships with suppliers and manufacturers also contribute to its earnings by allowing for promotional activities and cost efficiencies. Furthermore, the company's investment in e-commerce and delivery services has expanded its customer base and increased sales, particularly during the pandemic and in the growing online grocery market.

Albertsons Companies Earnings Call Summary

Earnings Call Date:Jul 15, 2025
(Q1-2025)
|
% Change Since: |
Next Earnings Date:Oct 21, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted strong digital and pharmacy growth, significant technological investments, and media expansion. However, these positive aspects were offset by declining gross margins, reduced EPS, and ongoing challenges in e-commerce profitability. This balance of positive and negative factors results in a neutral sentiment.
Q1-2025 Updates
Positive Updates
Strong Digital Growth
E-commerce grew by 25% and loyalty program membership increased by 14% to 47 million members.
Pharmacy and Health Segment Growth
The pharmacy and health segment grew 20% year over year, driven by script and immunization growth.
Investment in Modernization and Technology
Significant investments in technology modernization, including AI and automation, to drive productivity.
Retail Media Collective Expansion
Media collective growth outpaced the industry, enhancing digital inventory and personalization opportunities.
Negative Updates
Decline in Gross Margin
Gross margin rate decreased by 85 basis points due to investments in customer value proposition and mix shift impact.
Adjusted Earnings Per Share Decline
Adjusted EPS decreased to $0.55 from $0.66 in the previous year.
Challenges in E-commerce Profitability
E-commerce business is near breakeven but not yet profitable, indicating challenges in achieving full profitability.
Company Guidance
In the first quarter of fiscal year 2025, Albertsons Companies, Inc. reported a 2.8% growth in identical sales, with adjusted EBITDA reaching $1.11 billion and adjusted earnings per share at $0.55. E-commerce sales grew by 25%, now comprising 9% of total grocery revenue, while the loyalty program expanded by 14% to 47 million members. Pharmacy and health saw a 20% year-over-year increase, contributing significantly to overall sales growth. Despite a gross margin decrease to 27.1%, driven by strategic investments and a shift in business mix, the company maintained an adjusted EBITDA guidance of $3.8 billion to $3.9 billion for the fiscal year. Albertsons aims for identical sales growth in the range of 2% to 2.75% for the rest of 2025, fueled by continued investments in digital and pharmacy operations, as well as productivity initiatives expected to yield $1.5 billion in savings by 2027.

Albertsons Companies Financial Statement Overview

Summary
Albertsons Companies demonstrates steady revenue growth and sound cash generation capabilities despite facing profitability challenges. The company's balance sheet reflects high leverage but shows signs of stabilization. Continued focus on improving operational efficiency and managing debt levels will be crucial for sustaining growth and enhancing shareholder value.
Income Statement
65
Positive
Albertsons shows a stable revenue growth with recent TTM revenue at $81.01 billion compared to $80.39 billion in the previous year, indicating a modest growth trajectory. However, net income has slightly declined, resulting in a net profit margin decrease. The gross profit margin remains healthy, but the decline in EBIT and EBITDA margins suggests rising operational costs affecting profitability.
Balance Sheet
58
Neutral
The company maintains a high debt-to-equity ratio, reflecting significant leverage at a level typical for the grocery industry. Despite this, the equity ratio shows slight improvement, indicating some strengthening of financial stability. Return on equity has decreased due to lower net income, signaling challenges in generating returns for shareholders.
Cash Flow
70
Positive
Albertsons maintains a positive free cash flow, though it has decreased compared to previous periods. The operating cash flow to net income ratio signifies efficient cash generation relative to net income. However, the declining free cash flow growth rate suggests potential pressures on future cash availability for investments and debt servicing.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue81.01B80.39B79.24B77.65B71.89B69.69B
Gross Profit22.25B22.26B22.05B21.76B20.72B20.41B
EBITDA3.89B4.08B4.53B4.85B4.87B3.78B
Net Income954.30M958.60M1.30B1.51B1.62B850.20M
Balance Sheet
Total Assets26.47B29.31B28.79B28.75B30.77B29.39B
Cash, Cash Equivalents and Short-Term Investments151.00M339.20M212.00M477.20M2.97B1.78B
Total Debt14.31B14.18B14.24B15.01B15.30B16.07B
Total Liabilities23.25B25.92B26.05B27.14B27.75B28.06B
Stockholders Equity3.22B3.39B2.75B1.61B3.02B1.32B
Cash Flow
Free Cash Flow501.30M749.40M628.20M700.00M1.91B2.27B
Operating Cash Flow2.47B2.68B2.66B2.85B3.51B3.90B
Investing Cash Flow-1.83B-1.89B-1.75B-1.98B-1.54B-1.57B
Financing Cash Flow-786.20M-684.10M-1.18B-3.37B-789.50M-1.04B

Albertsons Companies Technical Analysis

Technical Analysis Sentiment
Negative
Last Price19.06
Price Trends
50DMA
20.14
Negative
100DMA
20.87
Negative
200DMA
20.42
Negative
Market Momentum
MACD
-0.22
Negative
RSI
40.21
Neutral
STOCH
25.78
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ACI, the sentiment is Negative. The current price of 19.06 is below the 20-day moving average (MA) of 19.37, below the 50-day MA of 20.14, and below the 200-day MA of 20.42, indicating a bearish trend. The MACD of -0.22 indicates Negative momentum. The RSI at 40.21 is Neutral, neither overbought nor oversold. The STOCH value of 25.78 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ACI.

Albertsons Companies Risk Analysis

Albertsons Companies disclosed 38 risk factors in its most recent earnings report. Albertsons Companies reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Albertsons Companies Peers Comparison

Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
70
Outperform
$44.79B18.4124.06%1.93%-2.11%25.03%
69
Neutral
$1.81B18.187.86%1.86%2.49%15.99%
67
Neutral
$13.57B28.6036.94%16.83%52.71%
66
Neutral
$1.80B231.020.68%8.47%-85.17%
63
Neutral
$20.52B14.80-2.68%3.09%1.95%-4.76%
61
Neutral
$10.67B11.6231.10%2.99%1.96%-14.99%
52
Neutral
$1.31B23.783.58%0.93%-7.96%-64.67%
* Consumer Defensive Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
ACI
Albertsons Companies
19.06
1.62
9.29%
IMKTA
Ingles Markets
70.59
-0.32
-0.45%
KR
Kroger Company
67.75
16.82
33.03%
WMK
Weis Markets
73.06
7.33
11.15%
SFM
Sprouts Farmers
138.83
38.73
38.69%
GO
Grocery Outlet Holding
18.32
1.37
8.08%

Albertsons Companies Corporate Events

Shareholder MeetingsBusiness Operations and Strategy
Albertsons Companies Holds Annual Stockholders Meeting
Neutral
Aug 13, 2025

On August 7, 2025, Albertsons Companies held its annual meeting of stockholders where several key proposals were voted on. Directors were elected for the upcoming year, Deloitte & Touche LLP was ratified as the independent accounting firm, and executive compensation was approved. However, stockholder proposals on food waste reporting, human rights policy, and reproductive health care risks were not approved, indicating a focus on traditional business operations over expanded social responsibility reporting.

The most recent analyst rating on (ACI) stock is a Buy with a $27.00 price target. To see the full list of analyst forecasts on Albertsons Companies stock, see the ACI Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 20, 2025